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Beneficiary Designations Are Important
Keeping it JustSimple
Designate Your Beneficiary
If you have a retirement account, life insurance, or maybe you just won the lottery and started a trust for your own interest or family; you get the option to have a beneficiary. The beneficiary is the person that will get your hard earned(or lotto earned) money when you pass away. It is amazing sometimes when I read about the various lawsuits that are in the news and the parties involved are disputing the face that the deceased did not list a beneficiary! The headache that it can cause to your family will have them cursing your name after your death. This may sound like a no brainer, but we all make mistakes, and especially when we get a new job and we are filling out all the paperwork we may forget about the small details with regards to listing those we want to leave in control of our assets.
It is easy to select multiple beneficiaries. If you have children, you can list them all and give them a percentage, as long as you have the percentages add up to 100% Some places will allow you to list a dollar amount instead of a percentage if you have a specific amount you want the beneficiary to inherit. I had a friend once who's mother passed away, and only left her $12500.01. A very odd number, and the rest of her fortune went to charity. That is just an idea of what you can do, but I always recommend to leave with family especially if you know a deserving family member that maybe struggling or you know will put your assets to goo use.
So the down side to not naming a beneficiary is Uncle Sam(the federal government), Cousin Sam(state government) may come knocking. You don't want Uncle, Cousin Sam into your pockets and getting your assets do you? If so, you can just make me the beneficiary, just spell it JustSimple Info LLC, and we will call it good OK? The Federal and State laws may choose a beneficiary for you in certain states. Remember that other uncle of yours that treated your kids, or mother wrong, do you want that person getting your assets?!?!?!
Be careful when you are married and you designate someone else other than your spouse as your beneficiary. Check with your state law, and probate court/lawyer regarding your spouse signing a notarized document giving the OK and acknowledging a different beneficiary besides themselves.
In most probate courts, your designation of a beneficiary overrides any provisions in your will and trust. If you have two different people listed in your will and your beneficiary form expect lawsuits after your death, so clean up and make sure everything and everyone is up to date! Remember that love of your life you had a few years ago, and it just didn't work out, well take that person off of your beneficiary forms and will! I read a story where a old girlfriend from 10 years ago, was notified that she would receive $450,000 for some life insurance policy, or fund because the guy forgot to add his new wife. After lawsuits, the girlfriend still won, because before the guy passed away he continued to make the payments on the premiums and spoke to the company that was providing it, but didn't try to update the beneficiary info.
Do you want to put your family through that headache? I hope not, do the right thing and keep your information updated.
When to update beneficiary:
Birth of a Child
Every 6 months review all your after death policies and forms.
Life is short, have fun while you are here, but make the quality decisions that make the transfer of assets as smooth as possible so your family and friends can celebrate your life, not morn your death in court fighting a legal battle.
Keep it JustSimple!